The ECB will start buying corporate bonds on Wednesday – World

 7:27 p.m.
 |
 AFP .-

The European Central Bank (ECB) will begin on Wednesday to buy corporate debt in the euro zone , under the array of initiatives launched in recent months to make off inflation.

the issuing institution finance thereby the activity of pharmaceutical groups , of airlines and automakers.

The ECB and ensures acquisition of 80,000 million euros per month of obligations in the markets to try to pull the economy out of the euro from its slumber area.

the plan of “quantitative easing” (QE, for its acronym in English) focused so far mainly in acquiring sovereign debt of the 19 countries in the currency bloc.

the QE, along with the low interest rates and huge loans banks make up the ECB’s strategy to boost the economy and ward off the specter of a deflationary spiral (falling prices, which delayed purchases and discourages investment).

from Wednesday, the institution based in Frankfurt acquire corporate debt , to facilitate the financing of companies and encourage them to invest.

the question remains whether the bread achieve its objectives. Many companies issue debt to invest , but also to repay loans.

corporate bonds only represent a small share of the € 80,000 million used monthly by the ECB to buy debt. Many analysts estimate that the volume will be 5,000 to 10,000 million. Experts from Commerzbank reduce that amount to a strip of 3000-5000 million.

“The ECB should be launched on the market with small steps,” experts say the German bank said in a note.

the market for these products is much smaller than that of sovereign bonds and the ECB set rules to restrict their room for maneuver. Shall not buy, for example, bonds issued by banks.